Upul Jayasuriya, Chairman, Board of Investment (BOI): Interview

Interview: Upul Jayasuriya

What is being done to promote Sri Lanka as an investment destination to new markets?

UPUL JAYASURIYA: Sri Lanka has traditionally relied on investment from Western nations; however, investment patterns have changed in recent years and the main focus is now on east Asia, as China, Malaysia, Singapore and India have emerged as leading investors in Sri Lanka. We therefore need to better understand these new economic partners and to convince them that we offer the best possible environment for them to invest. We have, for example, focused on developing promotional tools aimed at those countries in the Chinese, Japanese and Korean languages. For several years now, the BOI has employed an advisor for Japan, whose role was to help us communicate with leading Japanese companies and entrepreneurs. Similarly, we also have a South Korean advisor attached to our offices. To strengthen our capacity for dealing with China, the BOI has hired a Chinese-speaking officer and who can address business delegations. Those are some of the improvements which we have introduced with a goal of breaking into these new markets.

Which sectors are seeing the most investment, and what can be done to boost foreign direct investment (FDI) in other areas of the economy?

JAYASURIYA: This question is a very interesting one as it tells us a lot about Sri Lanka’s economy and perhaps also the way forward for our future economic development. The dominant sector in the last decade has been categorised by infrastructure and services – a wide area that encompasses property development, telecommunications networks, hotels, and even the IT and BPO sectors. Infrastructure and services have taken the lion’s share of investment; last year this totalled $551m, or approximately 68% of Sri Lanka’s FDI, the total which amounted to $801m. The next sector in order of importance is manufacturing, which includes textiles, apparel and leather products, as well as food production, and chemical, petrochemical and rubber products. In the manufacturing sector Sri Lanka received $248m in FDI and lastly, the agriculture sector, which received a modest $2m in investment.

The government is focused on encouraging and boosting manufacturing since the potential rewards come with higher incomes and employment opportunities, as well as stable, long-term growth from which the country can continue to build. Hence, the way forward will be to develop manufacturing but with increasing value addition to ensure that the country acquires inflows of expertise and also is in a position to significantly increase exports. The primary goal when investing in agriculture in Sri Lanka is to substitute imports with local produce and also to achieve a certain level of food security in the country. Those are the primary objectives which the board seeks to achieve through investment.

How can you ensure future human resource needs are met as the economy diversifies?

JAYASURIYA: We need to look at our workforce as a strategic resource and continually hone its skills so that they match the requirements of modern industry. This workforce should be able to cope with the requirements of the Sri Lankan economy as it steadily diversifies and moves away from the traditional apparels export industry. The workforce therefore needs to be able to do the work required of advanced industries, high-end services and even complex construction. Of course, training is a primary focus and our success will largely depend on whether we can attract foreign universities and training institutes. We hope that together with our own universities and institutions, we are able to significantly increase human resource capabilities. Ultimately, the most important resource a country can have is its people.